Dear Studio Fam,
The theme this week is drops. In the crypto world, we look at the sudden drop in the price of Bitcoin and Ethereum. In the media world, we look at the drop in traditional TV viewing. And in social media, we look at the drop of a very specific user. Finally, we look at a different type of drop from a legacy automaker playing catch up in the EV space.
Sudden Crypto Drop Sparks Competing Explanations
Crypto investors were left shocked this week by the sudden and seemingly simultaneous crashes of Bitcoin and Ethereum, the two most successful crypto currencies in terms of market cap. Between 2 PM and 10 PM ET on August 17, the spot price of both crypto currencies dropped more than ten percent, kicking off a flurry of competing explanations from crypto-focused news sites and mainstream journalists.
Macroeconomic explanations focused on the general sell off of stocks in recent days and notes from the Federal Reserve indicating the possibility of additional hikes to the prime interest rate. A higher prime interest rate makes bond investments more lucrative and reduces the demand for higher risk investments like crypto, though many have countered this is not sufficient to explain the sudden and seemingly correlated evaporation of over $75 billion in market capitalization in crypto markets.
More focused explanations cited erroneous reports about major crypto liquidations from companies like SpaceX, which had reported write downs on its crypto holdings in the aftermath of sales made in previous quarters. Other theories involved the recent bankruptcy filing from Chinese real estate and technology group Evergrande, though connections between that company and the larger crypto industry remain tenuous at best.
Live TV Hits All Time Low
After a decade of cord cutting, the balance of power in TV land has officially shifted. As of July, less than 50% of the time that Americans spend using their TVs is dedicated to cable and broadcast television. Both cable and broadcast television experienced historic declines, dropping 12% and 5% YoY respectively, while streamers like Netflix, YouTube, and Hulu saw similar increases in usage despite recent price increases.
Streamers still account for much less than half of total TV time – less than 39% according to Nielsen – with the remaining 11% of TV time dedicated to gaming through consoles like Xbox and Playstation. The drop in traditional TV usage is somewhat seasonal – there just aren’t that many sports to watch during the summer – and broadcasters are already hyping the fact that the balance will shift back in their favor once the NFL and NBA seasons start.
Jack Dorsey Deletes His Instagram, Claims WhatsApp Is “Compromised”
In simultaneous posts to X and open-sourced social network Nostr, Twitter co-founder Jack Dorsey announced that he had officially deleted his Instagram account. While not active on the platform for several years, Dorsey decided to officially scrub his presence from Instagram and all other Meta-related apps including Facebook and WhatsApp.
Surprisingly, Dorsey engaged with multiple user replies to the news to clarify that he really does not trust any of the technology from Meta. “Clear eyes, meta free, can’t lose” he tweeted, going even further to claim that WhatsApp has been “compromised.”
Netflix Ending DVD Service With Giveaway
Perhaps unbeknownst to most Netflix users, the original DVDs-by-mail service has continued to operate despite the surging popularity of streaming. But all good things must come to an end, and Netflix announced earlier this year that its original business of mailing people DVDs would come to an end later this year. The official shut off date for the DVD service has now been announced for September 25, along with a special invitation to users to receive an additional ten discs. The exact nature of this promotion remains unclear. Some have suggested Netflix intends to liquidate its DVD library with this giveaway, basically allowing its customers to keep whatever discs they get in their final month of service. Either way, it’s a fitting end to one of the original internet disruptors.
Acura Unveils Its First EV
Another week, another new electric vehicle announcement from a major legacy auto producer. Acura, the luxury marque of Japanese automaker Honda, unveiled this week its first fully electric performance SUV, the ZDX. Produced in partnership with GM, the ZDX features the same battery and drivetrain platform as the Cadillac Lyriq and Chevy Blazer EV. To an auto enthusiast, the similarities between the ZDX and its American cousins are obvious as all three cars have the exact same wheelbase, battery capacity, horsepower, and overall body structure.
The partnership with GM likely allows the ZDX to qualify for Federal tax rebates for electric vehicles with batteries produced in the United States: the Ultium batteries inside the ZDX will be made in the USA in Ohio. But the partnership also handicaps Acura by forcing it to rely on a competitor for batteries while it continues to develop its own battery technology. But that fact probably won’t deter buyers interested in an electric vehicle but turned off by market-leader Tesla’s spartan designs. Acura is a premium brand with a loyal following, and the company has put considerable effort into designing a luxurious interior to distinguish itself from the competition.